In July 2008 , Kathy paid 60,000 to acquire 90% of the ordinary shares of an unlisted
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In July 2008 , Kathy paid £60,000 to acquire 90% of the ordinary shares of an unlisted trading company. In May 2015 , she gave all of the shares to her son and both Kathy and her son elected that the gain arising on this gift should (as far as possible) be held -over. The net assets of the company on the date of the gift (at market value) were as follows:
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Goodwill Freehold building (used only for business purposes) Listed investments Net current assets (none of which are chargeable) Total net assets 100,000 150,000 50,000 40,000 340,000 (a) Compute the gain arising on the gift and the amount which may be held-over. (b) Compute the gain arising in March 2018 when Kathy's son sells all the shares for 350,000.
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a Presumably the value of the shares on the date of the gift was 90 of 340000 306000 So the gain ar...View the full answer
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